ENDNOTES

  1. ACT does not, in fact, agree, however, that "operating systems" and "browsers" are distinct markets or that Microsoft could retain its share of either market without continuously improving its products and competing intensively. On the first point, ACT believes that the relevant product market is "platforms for software applications" and that operating systems and browsers compete for the attention of software developers, as the Court’s findings suggest. See generally David S. Evans, All the Facts That Fit: Square Pegs and Round Holes in U.S. v. Microsoft, 22 Reg. 54 (1999). On the second point, IBM announced on January 7, 2000 that it intends to rely on Linux—not Windows or any other Microsoft product—"as the operating system of the future for the internet." Steve Lohr, I.B.M. to Use Linux System In Software For Internet, N.Y. Times, Jan. 10, 2000, at C1. On January 10, 2000, America Online ("AOL"), by far the largest Internet access provider and the owner of Netscape, announced the largest corporate acquisition in history, of a company with a vast range of content deliverable over the Internet, Time Warner. Given the relationships of Linux and Netscape to IBM and AOL, Microsoft can maintain its shares of operating system and browser sales only through hard competition on quality and price.
  2. See also Ocean State Physicians Health Plan Inc. v. Blue Cross & Blue Shield, 883 F.2d 1101, 1110 (1st Cir. 1989) ("Section 2 does not prohibit vigorous competition on the part of a monopoly."); United States Football League v. NFL, 842 F.2d 1335, 1361 (2d Cir. 1988) (jury was properly instructed that "a monopolist is encouraged to compete vigorously").
  3. Cargill, Inc. v. Monfort of Colo., Inc., 479 U.S. 104, 110 (1986) (quoting Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 488 (1977), quoting Brown Shoe Co. v. United States, 370 U.S. 294, 320, 344 (1962)).
  4. See also Ocean State Physicians Health Plan, 883 F.2d at 1113. ("[D]esire to crush a competitor, standing alone, is insufficient to make out a violation of the antitrust laws.").
  5. See also Alaska Airlines, Inc. v. United Airlines, Inc., 948 F.2d 536, 548 (9th Cir. 1991) ("The anticompetitive dangers that implicate the Sherman Act are not present when a monopolist has a lawful monopoly in one market and uses its power to gain a competitive advantage in the second market."); Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263, 276 (2d Cir. 1979) ("So long as we allow a firm to compete in several fields, we must expect it to seek the competitive advantages of its broad-based activity—more efficient production, greater ability to develop complementary products, reduced transaction costs, and so forth. These are gains that accrue to any integrated firm, regardless of its market share, and they cannot by themselves be considered uses of monopoly power.").
  6. The Findings project that Netscape’s market share will remain in the vicinity of 40 percent through at least January 2001, when the AOL contract expires. (See Findings 373) And beyond that, the Court found that Microsoft "is not likely to drive non-Microsoft PC Web browsing software from the marketplace altogether." (Id. 385) Indeed, just two weeks ago one of the country’s largest Internet access providers, Earthlink, made a promotional mass mailing of an Internet software compact disc containing both Netscape Navigator 4.03 and Internet Explorer 5.0.
  7. "After [the term of its agreement with Microsoft], AOL may be able and willing to prevent Internet Explorer’s share from achieving such dominance that a critical mass of developers will cease to concern themselves with ensuring that their Web content at least be accessible through non-Microsoft browsing software." (Findings 385) The Court further notes that this "dominance" has not occurred and that Netscape remains a substantial force on the Internet: "At least partly because of Navigator’s substantial usage share, most developers continue to insist that their Web content be more-or-less as attractive when accessed with Navigator as it is when accessed with Internet Explorer." (Id.) (emphasis added).
  8. Ted Bridis, Microsoft and AOL: On A Collision Course, Plain Dealer, Jan. 17, 2000, at 7B.
  9. "Competitors are free to sell directly, to develop alternative distributors, or to compete for the services of the existing distributors. Antitrust laws require no more." Omega Envtl., 127 F.3d at 1163. See also Seagood Trading Corp. v. Jerrico, Inc., 924 F.2d 1555, 1573 (11th Cir. 1991) (no anticompetitive impact where plaintiffs not foreclosed from every alternative); General Bus. Sys. v. North Am. Philips Corp., 699 F.2d 965, 979 (9th Cir. 1983) ("[A] defendant, having succeeded in legitimately controlling ‘the best, most efficient and cheapest source of supply . . . ’ does not have to share ‘the fruits of its superior acumen and industry.’") (citing Determined Prods., Inc. v. R. Dakin & Co., 514 F. Supp. 645, 648 (N.D. Cal. 1979)).
  10. It is hard to fathom plaintiffs’ contention that Microsoft’s decision to permit AOL on the Windows desktop, via the OLS folder, "made no business sense except as a means of eliminating Netscape as a platform threat." (Pls. Conclusions at 36) The inclusion of AOL on the Windows desktop made Windows and Windows-operated computers more attractive to consumers, helped introduce many consumers to the Internet, and spurred sales of PCs and of both operating systems and applications software. Plaintiffs’ position exemplifies what is perhaps the most fundamental flaw in their case—the need to assume that they know better than Microsoft what is good for Microsoft’s business.
  11. The Court noted that "Netscape had assured AOL that it would [create a componentized browser like Internet Explorer], and AOL believed that Netscape was capable of eventually making good on its pledge, but the fact remained that Microsoft had already completed a componentized version of Internet Explorer." (Findings 282)
  12. California Computer Prods., Inc. v. IBM, 613 F.2d 727, 744 (9th Cir. 1979) ("[A] monopolist [ ] had the right to redesign its products to make them more attractive to buyers—whether by reason of lower manufacturing cost and price or improved performance[,]" and are under no obligation to "constrict [ ] [their] product development so as to facilitate [the] sales of rival products."); Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263, 281 (2d Cir. 1979) ("Because . . . a monopolist is permitted, and indeed encouraged, by § 2 to compete aggressively on the merits, any success that it may achieve through the process of invention and innovation is clearly tolerated by the antitrust laws.") (internal quotation omitted).
  13. See also Microsoft Corp., 147 F.3d 935, 950 (D.C. Cir. 1998) ("Professor Areeda argues that new products integrating functionalities in a useful way should be considered single products regardless of market structure.") (citing X Phillip E. Areeda et al., Antitrust Law 1746b (1996)).
  14. Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law 1746.1a, at 487 (1999 Supp.) (noting that "[t]he operating system of today includes a calculator, simple word processor, multitasking capability, and a host of other features that were once sold separately from the operating system by different vendors"). See also Peter Huber, Reno Rewrites Your Operating System, Forbes, Dec. 1, 1997, at 308 (observing that "[a]lmost every new feature added to [Windows]" including modem drivers, memory management, CD-ROM drivers and fax utilities, "was sold by some other vendor in a separate box first" and "[m]ost of [these products] originally cost more than the whole of Windows costs today").
  15. The court of appeals’ use of a "plausible benefits" standard for this purpose is not only consistent with, but would now be required by, the Supreme Court’s subsequent decision in California Dental Ass’n v. FTC, 526 U.S. 756 (1999).
  16. See, e.g., Pls. Conclusions at 29-30 (citing Findings 410, 177); Pls. Conclusions at 58-59 (citing Findings 153, 177).
  17. See, e.g., ILC Peripherals Leasing Corp. v. IBM, 448 F. Supp. 228, 233 (N.D. Cal. 1978) (Since IBM’s drive unit including a hard/disk assembly ("HDA") constituted a single product, IBM was not obliged to sell the HDA at a separate price even though it would be possible to do so.); Innovation Data Processing, Inc. v. IBM, 585 F. Supp. 1470, 1476 (D.N.J. 1984) (Since IBM’s upgraded software program constituted "a lawful package of technologically interrelated components," IBM "could have properly chosen to offer [the upgraded program] without giving its customers the option of licensing its components separately."); GAF Corp. v. Eastman Kodak Co., 519 F. Supp. 1203, 1231-32 (S.D.N.Y. 1981) ("ordinarily a firm may market new products if and when it chooses . . . . so far as this Court is aware, no court has yet found a monopolist’s failure to market a product as satisfying § 2’s conduct requirement"); William H. Page & John E. Popatka, The Dubious Search for "Integration" in the Microsoft Trial, 31 Conn. L. Rev. 1251, 1273 (1999) (discussing whether Microsoft is obliged to provide a way for users to remove web browsing functionality from Windows 98: "it is unclear why Microsoft should be required to indulge the preferences of all categories of its users; certainly there is no antitrust reason for doing so" — and, in any event, such a requirement necessarily would embroil the court in the design process by obliging it to determine "what features would be deleted from the modified version and how the relative prices of the two versions would be established").
  18. See, e.g., X Phillip E. Areeda et al., Antitrust Law 1743b, at 194-5 (1996) (rejecting suggestion that defendants in tying cases be required to "offer the items both bundled and unbundled at prices that reflect whatever additional cost unbundling entailed, and let customers decide" because, inter alia, "the costs of judicial review to determine whether all the price differentials matched the cost differentials, or exceeded them in a way that produced a package discount tie, would be overwhelming"); Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law 1746.1e (1999 Supp.) (explaining why this sort of mandatory unbundling would be especially undesirable in the context of the software industry where the marginal costs of production are extremely low).
  19. See, e.g., Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2, 14 (1984) (requiring that market power in the tying product be "used to impair competition on the merits in another market"); Martino v. McDonald’s Sys., Inc., 625 F. Supp. 356, 362 (N.D. Ill. 1985) ("[T]he danger is that the tying seller will acquire market power in the tied product market.").
  20. "The inclusion of IE in Windows does not force users to adopt IE as their browser in the same way that the hospital in Jefferson Parish forced surgical patients to use a particular anesthesiologist." While "[a] surgical patient can only be anesthetized by a single anesthesiologist. . . . a purchaser of a Windows 98 computer who thereby acquires I[nternet] E[xplorer] 4 remains free to install Netscape Navigator, and indeed, OEMs are free to install it." Page & Popatka, supra note 17, at 1270.
  21. Internet Explorer really is "free," not paid for as part of the Windows package, and hence does not deter users from choosing another browser:

    22. If a monopolist of film, for example, were to include the cost of developing services in the price of film, and thus speciously offer "free" developing, the effect of the tie would be to exclude independent developers. But both Microsoft’s and Netscape’s browsers are free in all channels of distribution. . . . Thus, consumers are not inhibited by having paid for IE from choosing multiple browsers.

    Page & Popatka, supra note 17, at 1270.

  22. So long as Netscape remained free to "reach the ultimate consumers . . . by employing existing or potential alternative channels of distribution," Microsoft’s action would not "foreclose from competition any part of the relevant market," even if the OEM channel were "the best, most efficient, and cheapest" channel of distribution. Omega Envtl., Inc. v. Gilbarco, Inc., 127 F.3d 1157, 1163 (9th Cir. 1997) (quoting General Bus. Sys. v. North Am. Philips Corp., 669 F.2d 965, 979 (9th Cir. 1983) (internal quotation marks and citation omitted)). In the absence of evidence of actual foreclosure, even if Microsoft’s conduct did otherwise constitute "tying," it would still not violate Section 1. See, e.g., United Farmers Agents Ass’n v. Farmers Ins. Exch., 89 F.3d 233, 235-36 (5th Cir. 1996); Gonzalez v. St. Margaret’s House Housing Dev. Fund Corp., 880 F.2d 1514, 1516-17 (2d Cir. 1989); Carl Sandburg Village Condominium Ass’n No. 1 v. First Condominium Dev. Co., 758 F.2d 203, 210 (7th Cir. 1985).
  23. See, e.g., Findings 408 (Microsoft’s actions "contributed to improving the quality of Web browsing software, lowering its cost, and increasing its availability, thereby benefiting consumers.").
  24. See, e.g., Richard Morochove, Fast Forward, A Fight to the Finish: AOL’s Buyout of Media Giant Time Warner Gives Steve Case the Upper Hand in his Fight with Microsoft’s Bill Gates for Control of the Hi-Tech World. But What Does it Mean for the Other Contenders?, Toronto Star, Jan. 20, 2000, at FF1 (noting that Amazon.com continues to lose money in order to create an electronic shopping center "where you’ll be able to purchase anything you want"); Jim Kerstetter, Virtual Economics: A House of Cards, PC Wk., Apr. 26, 1999, available at 1999 WL 9712282 (noting that AOL provided the Internet "model for growth" by running "a financial deficit and [not] worry[ing] about profits while flooding the market with AOL access software. . . .").
  25. Indeed, the Court found that Microsoft might have charged the zero price irrespective of any desire to maintain the "applications barrier to entry." (Findings 136)
  26. William J. Kolasky, Jr., Network Effects: A Contrarian View, 7 Geo. Mason L. Rev. 577, 606 (1999). See also id. ("Customers play a dual role from the viewpoint of the network; they are the buyers of the services, but they are also the commodity that is being sold.") (quoting Jacques Crémer et al., The Degradation of Quality and Dominisation of the Internet, at 3, filed June 11, 1998, with Comments of GTE, in In re Application of WorldCom, Inc. & MCI Communications Corp., 13 F.C.C.R. 18,025 (1998)(No. 97-211)); see generally Carl Shapiro & Hal R. Varian, Information Rules: A Strategic Guide to the Network Economy 152 (1999) (where network effects are present, a new entrant may need to subsidize the buyer’s cost of switching by charging below-cost prices initially).
  27. See Kolasky, supra note 26, at 604-08.
  28. Microsoft’s rapidly rising revenues in the period since 1995, see Microsoft financial history, available at , resulting in large part from the explosion in use of the Internet, suggest strongly that Microsoft was correct in believing that its investment in Internet Explorer would produce a positive rate of return, wholly apart from whatever effect it had on the "applications barrier to entry."
  29. For these reasons, theories of predatory investment and innovation have been heavily criticized. See generally III Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law 747a, at 455 (1996); Joseph G. Sidak, Debunking Predatory Innovation, 83 Colum. L. Rev. 1121 (1983).
  30. See p. 17, supra; Findings 300 ("AOL had the right under its agreement with Microsoft to terminate the distribution and promotion provisions relating to Internet Explorer on December 31, 1998.").
  31. See Findings 267 (finding that the Windows 95 referral server agreements were "of relatively short duration"); id. 269 (finding that the Windows 98 referral server agreements had a one-year term and were terminable at will by the IAP on 90 days’ notice); id. 331 (finding that the ICP agreements "expired within seven months of the Channel Bar’s release"). Microsoft also unilaterally waived the challenged provisions of the IAP referral and ICP promotional agreements prior to the initiation of this lawsuit. (Id. 268-69, 331) With respect to the ICP agreements, the Findings state: "[T]here is not sufficient evidence to support a finding that Microsoft’s promotional restrictions actually had a substantial, deleterious impact on Navigator’s usage share." (Id. 332)
  32. See Findings 267 (finding that the Windows 95 referral server agreements were "of relatively short duration"); id. 269 (finding that the Windows 98 referral server agreements had a one-year term and were terminable at will by the IAP on 90 days’ notice); id. 331 (finding that the ICP agreements "expired within seven months of the Channel Bar’s release"). Microsoft also unilaterally waived the challenged provisions of the IAP referral and ICP promotional agreements prior to the initiation of this lawsuit. (Id. 268-69, 331) With respect to the ICP agreements, the Findings state: "[T]here is not sufficient evidence to support a finding that Microsoft’s promotional restrictions actually had a substantial, deleterious impact on Navigator’s usage share." (Id. 332)
  33. See, e.g., Barry Wright Corp. v. ITT Grinnell Corp., 724 F.2d 227, 237 (1st Cir. 1983) (Breyer, J.); Magnus Petroleum Co. v. Skelly Oil Co., 599 F.2d 196, 200-01 (7th Cir. 1979).
  34. The Court found that the limitations on the IAPs were "broader than they needed to be" to achieve economic efficiency (Findings 247), but that is not an antitrust violation in the absence of foreclosure of a substantial share of the market. See, e.g., Orson, Inc. v. Miramax Film Corp., 79 F.3d 1358, 1367-68 (3d Cir. 1996) ("[T]he plaintiff bears the initial burden of showing that the alleged combination or agreement produced adverse, anticompetitive effects. . . . If a plaintiff meets his initial burden of adducing adequate evidence of market power or actual anticompetitive effects, the burden shifts to the defendant to show that the challenged conduct promotes a sufficiently pro-competitive objective. . . . To rebut, the plaintiff must demonstrate that the restraint is not reasonably necessary to achieve the stated objective.") (citations omitted); K.M.B. Warehouse Distribs., Inc. v. Walker Mfg. Co., 61 F.3d 123, 127 (2d Cir. 1995) (same); Bhan v. NME Hosps., 929 F.2d 1404, 1413 (9th Cir. 1991) (same).
  35. United States v. Microsoft, No. Civ. A. 98-1232, 1998 WL 614485, at *19 (D.D.C. Sept. 14, 1998) (quoting Omega Envtl., 127 F.3d at 1162).
  36. See, e.g., Standard Oil Co. v. United States, 337 U.S. 293, 307 (1949) (exclusive dealing arrangements are "useful . . . to a seller trying to establish a foothold against the counterattacks of entrenched competitors") (citation omitted). Exclusive dealing arrangements serve this purpose by "focusing the distributor’s efforts on one product line. . . ." Ryko Mfg. Co. v. Eden Serv., 823 F.2d 1215, 1234 n.17 (8th Cir. 1987).
  37. See Ryko Mfg. Co., 823 F.2d at 1234 & n.17; see also Howard P. Marvel, Exclusive Dealing, 25 J. L. & Econ. 1, 6-10 (1982).
  38. See Marvel, supra note 37, at 6-10.
  39. Pls. Conclusions at 33 (quoting Findings 242). Only in that case would the Court have to the reach the question of whether the restrictions were reasonably necessary to achieve the claimed procompetitive objectives. See California Dental Ass’n v. FTC, 526 U.S. 757, 119 S.Ct. 1604, 1616-18 (1999) (holding that defendant cannot be required to prove that alleged restraint serves procompetitive purpose until plaintiff proves, with empirical evidence, that it harms competition). Should the Court reach this issue, amicus respectfully disagrees with the finding that the limitations on the freedom of IAPs to distribute and promote Navigator were "broader than they needed to be" to achieve economic efficiency. (Findings 247) The limited nature of the restrictions and their short duration, which coincided with Microsoft’s entry into the browser market, made them narrowly tailored to achieve Microsoft’s legitimate objective of soliciting the help of these IAPs and OLSs to break into the browser market while preventing them from misappropriating the consideration Microsoft paid them—placement on the referral server and online services folder—for their help.
  40. See generally Charles T.C. Compton, Cooperation, Collaboration, and Coalition: A Perspective On The Types And Purposes Of Technology Joint Ventures, 61 Antitrust L.J. 861, 869 (1993) ("[T]echnology companies are rejecting the former conventional wisdom that mandated ‘vertical integration’ . . . . Instead, vertically integrated companies are being metamorphosed into companies that are ‘virtually integrated’ - linked up, down, and sideways in a value chain extending from research and development, through manufacturing, to marketing, sales, and distribution - within a network of alliances and partnerships.") (internal quotations omitted) (quoting Ernst & Young, Electronics 92: Strategic Alliance Outlook, at 1); Thomas M. Jorde & David J. Teece, Antitrust, Innovation, and Competitiveness 16 (1992) (The requirements of the innovation process increasingly "are such that no single firm has the capacity to conduct all of this activity alone, for reasons of cost, competence and timeliness."); Shapiro & Varian, supra note 26, at 258 ("To compete effectively in network markets, you need allies."); Adam M. Brandenburger & Barry J. Nalebuff, Co-opetition 4 (1996) (In network markets, "‘[y]ou have to compete and cooperate at the same time.’") (alteration in original) (quoting Ray Noorda, Ex-CEO, Novell, Inc. in interview with Dwight B. Davis, Noorda: Leaving When Times Get Tough, Electronic Bus. Buyer, Dec. 1993.).
  41. See also Polk Bros. v. Forest City Enters., Inc., 776 F.2d 185, 188 (7th Cir. 1985) (Easterbrook, J.) ("Cooperation is the basis for productivity. It is necessary for people to cooperate in some respects before they may compete in others, and cooperation facilitates efficient production.").
  42. Federal Trade Commission, Request for Views on Draft Antitrust Guidelines for Collaborations Among Competitors, 64 Fed. Reg. 54,484, 54,484 (1999). "Efficiency gains from competitor collaborations often stem from combinations of different capabilities or resources. . . . For example, two firms may be able to combine their research or marketing activities to lower their cost of bringing their products to market, or reduce the time needed to develop and begin commercial sales of new products. Consumers may benefit from these collaborations as the participants are able to lower prices, improve quality, or bring new products to market faster." Id. at 54,486.
  43. See, e.g., Addamax Corp. v. Open Software Found., Inc., 152 F.3d 48, 52 (1st Cir. 1998) ("Joint venture enterprises like OFC, unless they amount to complete shams, . . . are rarely susceptible to per se treatment.") (citation omitted); Northrop Corp. v. McDonnell Douglas Corp., 705 F.2d 1030, 1050-54 (9th Cir. 1983) ("teaming arrangement" by which one joint venturer would be prime contractor for land-based aircraft and the other would be prime contractor for carrier-based aircraft should be judged under the rule of reason); Van Dyk Research Corp. v. Xerox Corp., 478 F. Supp. 1268, 1304 (D.N.J. 1979) (upholding a joint venture which divided world markets for output since the restraints "were reasonable and ancillary to the formation of speculative business ventures"), aff’d, 631 F.2d 251 (3d Cir. 1980).
  44. Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263, 281 (2d Cir. 1979). See also California Computer Prods. v. IBM, 613 F.2d 727, 744 (9th Cir. 1979) ("IBM, assuming it was a monopolist, had the right to redesign its products . . . . IBM need not have provided its rivals with disk products to examine and copy . . . nor have constricted its product development so as to facilitate sales of rival products.")
  45. Even in the case of IBM, which had adopted an "IBM First" policy of promoting its own software to the near-exclusion of Microsoft products, all that Microsoft did was delay granting IBM a license to Windows 95 until a royalty dispute was resolved and decline to help market IBM PCs that had IBM, rather than Microsoft, software pre-installed. (Findings 115-132) Neither of these actions violates the antitrust laws. As a copyright holder, Microsoft was free not to license Windows 95 to an OEM that was in arrears on its royalty payments under past licenses and, unlike other OEMs, was favoring its own software over Microsoft’s. Data General Corp. v. Grumman Sys. Support Corp., 36 F.3d 1147, 1187 (1st Cir. 1994) ("author’s desire to exclude others from use of its copyrighted work is a presumptively valid business justification").
  46. The only instance plaintiffs cite in which the target of Microsoft’s alleged attacks ceased its development efforts was Intel’s decision to stop developing NSP software technology in response to Microsoft’s concerns with its compatibility and quality and Microsoft’s offer to take over its development. Microsoft’s conduct in this instance, however, appears neither coercive nor anticompetitive. As the Court found, "Microsoft’s concerns with compatibility and quality [of NSP] were genuine" (Findings 99), and Microsoft agreed in return to incorporate some aspects of NSP into its Windows operating system. (Id. 101)
  47. The Findings also state that "at least one" independent software developer agreed with Microsoft not to distribute or use non-Microsoft Java tools, but the Findings do not identify the developer or provide any particulars. (Findings 402) And in any event, there is no antitrust significance to a single such occurrence among the multitude of independent software developers.
  48. Nor, as shown in Part II, have plaintiffs proven either of their Section 1 claims. Microsoft’s integration of browser functionality into Windows provided plausible consumer benefits and was not, therefore, a per se unlawful tying arrangement. See pp. 18-21 supra. Microsoft’s contracts with AOL and other IAPs served legitimate business purposes and did not foreclose Netscape from the IAP channel of distribution, much less from the market as a whole, and therefore were not unlawful exclusive dealing arrangements. See pp. 23-24 supra.
  49. "Specific intent," for purposes of Section 2, means proof that a defendant had "a specific intent to destroy competition or build monopoly." Times-Picayune Publishing Co. v. United States, 345 U.S. 594, 626 (1953). A desire to increase market share or win customers does not satisfy this standard. See, e.g., United States Steel Corp. v. Fortner Enters., Inc., 429 U.S. 610, 612 n.1 (1977) ("‘increasing sales’ and ‘increasing market share’ are normal business goals, not forbidden by § 2 without other evidence of an intent to monopolize").
  50. As Professors Areeda and Hovenkamp explain, "if the defendant can experience rapid growth in market share, others can as well. Market shares that go from 0 to 60 percent in two years . . . suggest an unstable market in which it is unlikely that any firm could maintain a monopoly output reduction for very long." IIIA Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law 807e2, at 359-60 (1996).
  51. See Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d 887, 894-95 (10th Cir. 1991) (60% market share does not establish dangerous probability of monopolization in highly competitive business where "innovative and daring entrepreneurs may enter the market quickly."); see also Metro Mobile CTS, Inc. v. NewVector Commun., Inc., 892 F.2d 62, 63 (9th Cir. 1989) ("[I]t is axiomatic that monopoly power is unlikely to arise in dynamic industries marked by a rapidly expanding volume of demand and low barriers to entry.") (citing J. von Kalinowski, 3 Antitrust Laws and Trade Regulation § 8.02[3] at 8-44 & nn. 82-83 (1989 & Supp. June, 1989); II Phillip E. Areeda & Donald Turner, Antitrust Law 505 (1978)).
  52. See Franklin M. Fisher et al., Folded, Spindled, and Mutilated: Economic Analysis and U.S. v. IBM 165 (1983) ("[A] barrier to entry only exists when an incumbent firm can refrain from competing without inducing entry.") (emphasis in original).
  53. Recognizing what Judge Posner called the "insoluble ambiguity about anticompetitive intent," Olympia Equip. Leasing Co. v. Western Union Tel. Co., 797 F.2d 370, 379 (7th Cir. 1986), the courts now acknowledge that evidence of subjective intent is largely irrelevant and more likely to mislead than to illuminate. See generally III Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law 651a, at 74 (1996) ("the nature and consequences of a particular practice are the vital consideration, not the purpose or intent, . . . and are almost always established by objective facts."); SCFC ILC, Inc. v. Visa USA, Inc., 36 F.3d 958, 970 (10th Cir. 1994) (If adoption of bylaw to discourage price competition was not "objectively anticompetitive the fact that it was motivated by hostility to competitors . . . is irrelevant.") (quoting Olympia Equip., 797 F.2d at 379); Fishman v. Estate of Wirtz, 807 F.2d 520, 543 (7th Cir. 1986) ("Hostility to a rival is not a sure sign of anticompetitiveness because ‘[v]igorous competitors intend to harm rivals, to do all the business they can. To penalize this intent is to penalize competition.’") (quoting Ball Mem’l Hosp. Inc. v. Mutual Hosp. Ins., Inc., 784 F.2d 1325, 1339 (7th Cir. 1986)); Olympia Equip., 797 F.2d at 379 ("[I]f conduct is not objectively anticompetitive the fact that it was motivated by hostility to competitors (‘these turkeys’) is irrelevant. . . Most businessmen don’t like their competitors, or for that matter competition."); Union Leader Corp. v. Newspapers of New England, Inc., 284 F.2d 582, 584 (1st Cir. 1960) ("But intending the natural consequences of acts which are in all respects lawful, does not constitute the ‘exclusionary intent’ that is a prerequisite for a finding of violation under section 2.").
  54. This is particularly dangerous where, as in the case of the market for operating systems for Intel-compatible computers, the benefits of ubiquity to consumers—"positive network effects"—may be so strong as to make the market a natural monopoly, in which the most efficient outcome is for the entire market to standardize on a single operating system. See Omega Satellite Prods. Co. v. City of Indianapolis, 694 F.2d 119, 127 (7th Cir. 1982) (Posner, J.) ("It is also true that the antitrust laws protect competition not only in, but for, the market—that is, competition to be the firm to enjoy a natural monopoly, . . . and by a modest extension competition to replace the existing natural monopolist. If the most efficient method of determining which firm should have the natural monopoly is a competitive process that will inevitably destroy the other firm, the antitrust laws presumably would forbid interference with that process.") (citation omitted). See generally Kolasky, supra note 26.
  55. E.g., Findings 411 ("There is insufficient evidence to find that, absent Microsoft’s actions, Navigator and Java already would have ignited genuine competition in the market for Intel-compatible PC operating systems."); id. 407 (" It is not clear whether, absent Microsoft’s interference, Sun’s Java efforts would by now have facilitated porting between Windows and other platforms enough to weaken the applications barrier to entry.").
  56. III Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law 650c, at 69 (1996).